Why the 16th century still matters: China, Spanish America and globalization

Theodore de Bry ‘Navigational vessel of China’

Andrés de Urdaneta is a name that few other than specialist historians will immediately recognise. He was one of the last of the fifteenth- and sixteenth-century explorers and navigators from the Iberian peninsula whose voyages resulted in redrawing the globe in more or less the form we know it today. Christopher Columbus has a country and several cities named after him; Ferdinand Magellan has the famous straits. But Urdaneta has no such monuments.

Perhaps this is because Urdaneta didn’t discover how to get anywhere, but rather less glamorously but no less importantly discovered how to get back. Until 1565, no fleet had succeeded in sailing east from Asia back across the Pacific to the Americas. It was Urdaneta, a survivor of earlier expeditions, who first worked out the right winds and currents across the uncharted waters of this vast ocean. His discovery was called the tornaviaje, or ‘return trip’.

The importance of this achievement was well understood at the time: the King of Spain had made it an explicit objective of the voyage, and Urdaneta’s arrival in Mexico was cause for public celebration. A letter of the time said that ‘those of Mexico are mighty proud of their discovery, which gives them to believe that they will be the center of the world.’

Stories are best started at the beginning. This one – the story of our increasingly integrated world – begins in the Pacific around 1565 and not, as conventional wisdom often has it, in the Western Europe of the mid-eighteenth century.

They were, as we shall see, arguably correct in this belief. The trading route that resulted from Urdaneta’s discovery – that of the Manila galleons – brought the silver from the Americas that underpinned China’s money supply and transformed the global economy. This Ruta de la Plata – or ‘Silver Way’ – characterised a period when commerce between China and Spanish America formed the lynchpin of trade routes spanning four continents. It also marked the first time the entire world had been knitted together with the global trade and financial networks that form the basis of our modern globalised world and ushered in the global economy that remains with us today.

Urdaneta’s discovery and its lasting significance seem largely forgotten, at least in the English-speaking world, among the dustier shelves of the historical record. Yet today’s tightly-linked, globalised world derives its origins not so much from the Industrial Revolution as from this earlier period. The pivotal role of Spanish America and China in these previous 250 years of global integration has been obscured and superseded by the prevailing narrative of Anglo-American predominance in everything from the economy to technology to military power.

Yet China is an increasingly square peg in this round narrative hole. China is, however, more easily accommodated by moving the start of the narrative back by two centuries to a period before New York and London were financial capitals – to, indeed, a period before the United States even existed.

If Urdaneta is to globalisation what Columbus is to America, why has he come to be largely forgotten in the English-speaking world? Indeed, the Manila galleon, the silver trade and the role of the Spanish silver peso seem to be largely absent from Anglo-American history texts, except those specialising in the precise period or subject. This particular amnesia can be dated. The ‘Indies’ trade in general, and silver in particular, remain central to many of the arguments about economics in Adam Smith’s The Wealth of Nations, published in 1776. But as the Spanish Empire receded from the scene, and English-speakers found they had other geopolitical and economic priorities, not least the Industrial Revolution, forgetfulness began to set in.

From the heights of American global dominance, the fork of history that led to the Spanish Empire seemed something of a cul-de-sac, tangentially relevant to further global progress. Two hundred and fifty years of Sino-Spanish trade were relegated – again, in the English-speaking world – to specialist journals whence they have only recently started to re-emerge.

Urdaneta, who was a navigator, understood the importance of maps and charts. They told you where you were, where you had been, where you were going and how to get back. Unless, of course, like Columbus’s charts, they didn’t. The reality that Columbus found didn’t agree with his charts, yet he spent the rest of his life trying to get reality to fit the chart rather than changing the chart to fit reality.

Jodocus Hondius’s ‘reduced’ map of China (Amsterdam, 1607)

Twenty-first century China is to the prevailing Anglo-American historical narrative what the Americas were to Columbus’s charts. A rising China – one of the world’s largest economic powers, with a military able to project force and a political culture that predates the Enlightenment – does not fit the model. It is a world power increasingly willing to go its own way outside the structure of multinational institutions so painstakingly built up since the end of the Second World War. It is no surprise that China can seem bewildering.

China bewildered the Spanish of 450 years ago as well. But they would have at least recognised a China that restricted navigation, wanted and often succeeded in setting the terms of trade and did things in its own way and that was rarely amenable to either persuasion or the use of force – a China, in other words, that expected the rest of the world to accept it on its own terms.

Two and a half centuries of increasing Anglo-American dominance, a trend that only increased in the post-Second World War period, has not just meant political, military and economic pre-eminence; it has also meant the steady encroachment of laws, language, currency, interest rates, philosophy, business practices and general priorities into local prerogatives. What might this narrative predict for a twenty-first century containing a China which has returned to its status quo ante?

Even the most optimistic observers now realise that today’s resurgent China does not seem content to play the part that this narrative has scripted for it, nor to play a part in any script but one largely of its own writing. The alternatives are not happy ones. Terms emanating from both the Second World War and the Cold War have recently been bandied about in reference to possible future scenarios.

It is important to bring early-modern Asia back into the prevailing historical narrative.

The Silver Way, however, offers a third possibility: globalisation with neither convergence nor major armed conflict, where the two sides integrate but remain apart. This third possibility is not one where one side progresses while the other is held back: rather, the parties are in equilibrium, albeit an unstable one, subject to disruption, changes in relative terms of trade, differing interests and objectives and more than occasional misunderstandings.

It is important to bring early-modern Asia back into the prevailing historical narrative, to update our maps by making them older. Once we do, many of the trends we now consider inevitable seem not to be trends at all. The link between the narrative of the Silver Way and the later Anglo-American narrative is silver, or rather the monetisation and integration of the world’s economies via currency and financial markets. The link remains today in the form of the US dollar and the Chinese yuan, both of which are descended from the Spanish peso. If the Sino-American relationship really is the world’s most important of the twenty-first century, then Americans need a conceptual structure that doesn’t measure China’s rise against an ill-fitting historical yardstick.

The coming mid-century need not look like the turn of the last century, nor, God forfend, like the mid-1900s. It might instead resemble the world’s first globalisation at the turn of the seventeenth century: an East and West that have neither converged nor descended into uncomprehending enmity, but rather in precarious balance, simultaneously cooperating and seeking advantage.

Stories are best started at the beginning. This one – the story of our increasingly integrated world – begins in the Pacific around 1565 and not, as conventional wisdom often has it, in the Western Europe of the mid-eighteenth century.

Peter Gordon is editor of the Asian Review of Books. Juan José Morales is an entrepreneur and historian. He reviews for Asian Review of Books, and his writing appears in the Caixin, The South China Morning Post and other publications.